Social Media Pioneer Digg Sells for $500,000

Digg Inc., a social-media pioneer once valued at more than $160 million, is selling for the deeply discounted price of about $500,000, Spencer Ante reports on digits. (Photo: Getty Images)

This transcript has been automatically generated and may not be 100% accurate.

... I ... so ... right so yesterday afternoon we broke that does that mean that that that was his once the social media star as one hundred and sixty million dollars or one point ... one seven hundred and sixty million BestBuy and I've been on the soulful was sold for what we learned five thousand around five dollars non cash today it works is is is this incubator New York ... the story ignited a firestorm in the lead to new T D tells are coming out yet with did you watch the show you a job or Joe Walker ... broke the story ... I'm it's pretty thick so with the initial investors this is a pretty big names and I guess they must be feeling kind of ... a bit sore right place now right so digger Raises forty five million dollars in venture capital from some of leading firms including Greylock Partners Highland Capital the usual such as Marc Andreessen and the Hoffman profit Chris Nicholson and the climate and Netscape ... which was a huge he was in his own budget I will never know this is what you enjoy this investment so what what came out after was that the CEO of day that Williams told AllThingsD that the deal was significantly larger than I was a combination of cash and equity ... we dug into that we found that with the truth is that big investors ... God warrants in this new one this ... one-on-one is this is important right so what is essentially a stock option is the right to buy a sermon on the stock with the top of the company issued by that this new company so that it works acquired did the taking decanter combining that with this news got property the house ... so they got warts in this new company ok ... the new company ... is very on unproven ... on paper the words values it at around five to ten million pounds is the isthe warrants on paperwork a few hundred thousand so ... it's not actors from Atlanta said that a significantly larger another of Ms ... we didn't say it is is larger because the icing didn't launch are the top ten ... so the other thing that came out was that TechCrunch reports that Lin Dan bought some patents ... from there were a few million box ... if you have it all up even if it's true that all the different parts of the continent they were sold for say fifty million dollars or whatever in that range ... it's it's still a huge loss for the investors have lost more than two-thirds of capital invested in tech and Dom it's also not right for me the employees who were basically doing all of this stuff aam tells a very quick and about ten seconds about a guy who's ready I'm happy content apps ... yet it was one guy is that you want the cash adding on the Riviera ... Universal the company ... they got out maneuvered by Facebook and Twitter about what has to look into the ground traffic fell by more than half of the last two years with new CEO ... it's a cautionary tale that could result in a fast twenty headed off a second lowest in the city to come to Fulham Road ... site Dickie maybe I was the fourth thank you very much spends on say